Petron Q1 profit drops to P2.2B

MANILA, Philippines - Petron Corp., the country’s largest oil refiner, reported yesterday a lower consolidated net income of P2.2 billion in the first quarter of the year, from P2.5 billion a year ago. 

In a disclosure to the Philippine Stock Exchange (PSE), Petron attributed the decline to lower prices of both crude and finished products. 

“Reference prices for both crude oil and finished products dropped during the current period, causing a drastic drop in retail prices against higher costing inventory. Dubai crude averaged $116.45 per barrel in the first three months of 2012 compared to $108.19 per  barrel over the same period in 2013,” Petron said.

Petron reported a lower net income despite higher revenues. 

Revenues rose 50 percent to P112 billion in the first quarter of the year from P74.7 billion in the same period last year, boosted by  the consolidation of Petron Malaysia in the second quarter of last year. 

In terms of sales, Petron said first quarter sales volume increased 66 percent to 20 million barrels from 12 million barrels a year ago. 

Despite the lower net income during the quarter, Petron said the company continued to enhance its leadership position by posting a seven-percent sales volume growth in the “strategic but highly-competitive  retail sector.” 

Growth came from the company’s network expansion in underserved areas.

“Currently, Petron operates the largest network in the industry with 2,070 service stations – bigger than its two closest competitors combined. Petron sustained its leadership with over 38 percent of the  total market,” it said.  

In Malaysia, Petron has also converted 125 of the 550 service stations to the Petron brand. The rebranding program, to be completed by 2014, translated to improved facilities and personalized services. 

Petron chairman and chief executive officer Ramon Ang said he is optimistic on the company’s growth. 

“Petron is in a period of unprecedented growth and expansion. The projects we set out to do a few years ago are nearing completion and with it, the prospects of a better future for both the company and the country,” Ang said. 

The oil refiner is currently working on the company’s $2-billion Refinery Master Plan Phase 2, which has been 70 percent completed as of March 2013. 

Petron is eyeing to finish the second phase of the expansion program by 2014.

“RMP-2 will significantly increase production of gasoline, diesel, and petrochemicals at Petron’s Bataan refinery. RMP-2 will enhance the country’s fuel supply security since it gives more flexibility to  refine crude oil from various, non-traditional sources,” Petron said. 

Petron’s refinery produces 180,000 barrel-per-day, supplying nearly 40 percent of the country’s total fuel requirements. 

It has a network of more than 2,000 service stations nationwide, selling gasoline, diesel and kerosene to motorists.